Creating the business strategy is one thing. Ensuring that it is regularly visited, qualified and challenged is another, and one that is very often overlooked.
Here at ADLIB we regularly refer back to our business strategy. Our business strategy is something everyone at ADLIB should be aware of, it defines goals, encourages collaboration and ensures transparency is baked into our company culture. So having a clear business strategy seems to be quite important.
Also your business doesn’t exist in a vacuum. Internal and external conditions, circumstances and environments change and we always try to ensure that our business direction is still the best path to take when taking all of the above in consideration.
Chris Thurling
(pictured right) agrees with us on its importance. He works as an independent strategist, coach, mentor and non-executive director to marketing and design agencies. We caught up with Chris to ask his expert opinion. Here’s what he has to say on the matter:
ADLIB: Starting with the basics, how would you define ‘business strategy’?
Chris Thurling: Strategy is about how you get from where you are now to a desirable point in the future making the best use of the means you have available. The heart of strategy is crafting choices: about what your business will and won’t do, which customers you serve and which you don’t and where you will devote resources and where you won’t. This is the hard part because it’s very tempting to ‘keep your options open’!
“When everyone is pulling in the same direction a business is in much better shape to succeed”
ADLIB: Why is it so important to define the direction of your Business?
CT: There are all sorts of reasons, but the two I’d focus on are: getting your team aligned and making the most of your resources. Without a clearly articulated strategy (i.e. this is where we want to get to and this is how we are going to get there) there’s the danger that the management team head off in multiple directions, confusing not only their colleagues but the company’s customers as well. Effort and resources are diluted and the potential for disharmony at all levels in the business increased.
When everyone is pulling in the same direction and scarce resources are spent on the things that really matter to winning in the marketplace, a business is in much better shape to succeed. It sounds like common-sense, but in practice it’s not always easy (as almost anyone who’s run a company will tell you!)
ADLIB: For those in the very early stages of setting up their business and direction, can you share three key considerations that could help inform and form the Business Strategy?
CT: My favourite book on business strategy is called ‘Playing to Win’ (PTW) by Roger Martin and A.G. Lafley. I base my strategy work with agencies on their simple but powerful framework. It was developed at Proctor & Gamble but can be used in companies large, small and starting up. According to the authors of PTW, if you can answer the following five questions then you are well on the road to having a solid strategy:
What is your winning aspiration? Sometimes this can be referred to as a mission or vision, which many people find rather abstract. PTW gets you to think in more concrete terms about winning in reference to your customers and competitors. In sport, winning is easy to define and that makes it easier to plan for. In business, winning can be an equally powerful motivator, but you’ve got to make it tangible.
Where will you play? This is where you need to start making choices – which customer segments, in what geographies, via what channels, in what categories will you sell your goods or services?
How will you win? Are you going to win on cost or differentiation? If the latter (and most agencies compete on some sort of differentiation) what is your particular competitive advantage? Remember, it doesn’t have to be unique… it just has to mean you win more often than not based on the ‘where to play’ choices you have made.
What capabilities must you have? To support your competitive advantage, what does your company need to be really great at doing? Your unique blend of capabilities is what makes you a strong company, with a great future – providing you’ve made the hard choices!
What management systems do you need? Sounds a bit dry, but as your company grows you will rely on the right systems to support your capabilities and measure what is happening within the organisation. As businesses grow, they need reliable and relevant data in order to oil the wheels of swift and effective decision making. An absence of the right systems can scupper all the good work of an elegantly thought through strategy.
“It’s one thing creating a strategy; it’s another implementing it”
ADLIB: Pulling everything together and ensuring you stay on track can seem daunting. Are there any avenues available that can help?
CT: I started and was MD of my own digital agency for 17 years and I found strategy the hardest part of the job. I got so caught up in the day to day, that it was hard to take a step back and get an objective view of the business. One of the best moves we made was employing a non-executive director (NED) to bring an external strategic perspective to things. I don’t think that it was a coincidence that we hit our target of £1m turnover and that our sales went up 265% in the five years after we appointed our NED.
Since moving on from my agency I’ve worked with an executive coach (and trained as one myself). It’s one thing creating a strategy; it’s another implementing it. I’ve found that working with a coach is a great way to keep you on track to achieving the goals and objectives you’ve set yourself and your business.
Thank you Chris for sharing with us.
If you have a strategic business challenge you would like to talk through, Chris runs free 45 minute ‘Strategy Surgeries’ at The Kensington Arms in Cotham every month. You can contact him via chris@christhurling.com to find out more.
